The Ministry of Industry and Information Technology and the State Administration for Market Regulation have issued the first national-level document regulating payment terms for the automotive industry. The new guidelines mandate that automotive companies must submit reports on their payment status to the authorities by the end of January and July each year.
The regulations establish clear standards for payment cycles, starting from the date of delivery and acceptance. For production materials, inspections must be completed within 3 working days, or 5 working days if vehicle installation testing is required. Companies are required to pay interest on overdue payments and are encouraged to prioritize cash payments over commercial bills.
During price negotiations, companies must make advance payments: at least 90% of the last contract price for continuous supplies, or 70% of the industry average or designated price for non-continuous supplies. The policy aims to resolve payment delays that pressure small and medium-sized suppliers and threaten supply chain stability.
Implementation will be monitored through self-reporting, third-party evaluations, and government oversight. In June 2025, 17 major automotive companies committed to keeping payment terms under 60 days. Despite these efforts, authorities noted that inconsistent standards for invoice processing and acceptance times continue to hinder progress in the sector.
